Not answering telemarketing calls from companies or organizations you haven't heard of is one way to avoid buying worthless products or services, or falling for a scam.

But if you do pick up the phone and a telemarketer asks you to make a payment, you should know that the Federal Trade Commission says that telemarketers can only ask you to make payment in specific ways.

Under the Telemarketing Sales Rule, you cannot use cash-to-cash money transfers such as those provided by MoneyGram and Western Union. These systems, which allow for cash to be easily transferred, are often used by crooks because they allow them to receive the funds remotely while masking their identities.

You also can't make payment to a telemarketer by using cash reload cards, such as MoneyPak, Reloadit, and Vanilla Reload. That's because when consumers pay cash for such cards, they have to scratch off a shielded code number that's typically covered with a protective coating in order to add money to a prepaid card.

But a scammer posing as a telemarketer could ask for that code number. If you supply it, the scammer can then load the cash onto his or her own prepaid card and use it to withdraw funds from an ATM. 

While Maureen Mahoney, a public policy fellow at Consumers Union, the advocacy and policy arm of Consumer Reports, says the Fed rules help to protect consumers, more should be done. "We think it should be easier for consumers to protect themselves from getting unwanted robocalls in the first place—many of which are from scam callers." 

Karen Hobbs, an attorney in the FTC's Bureau of Consumer Protection, agrees. "If someone is asking you to use one of those payment methods, that person is a bad guy," says Hobbs.

The payment industry has also changed some practices on its own, to protect consumers. Companies that marketed MoneyPak and other cash-reload cards, which have been used in scam operations to transfer untraceable cash from a victim to an anonymous scammer, are no longer distributing them, Hobbs notes. But she says they may still be on the market in some places, and still pose a threat to uninformed victims.

What You Should Do

If you get a call from a telemarketer trying to sell you something you aren't interested in, simply say "no." If an unsolicited caller requires you to provide personal information—your Social Security, bank account number, or credit-card number hang up and report the call to the FTC. If you choose to listen to the telemarketer's pitch, take these precautions to protect your identity and your money: 

  • Hang up if the caller doesn't say upfront whether he or she is making a sales call, who the vendor is, and what's being sold. Every telemarketer is required to provide that information.
  • Reject anything "free" since it will likely require a fee later.
  • Don't pay for anything over the phone that you didn't call about yourself. 
  • Research charities that aren't familiar to you before donating to one.
  • Pay only by credit card. It's the only way to dispute charges later. "There are legitimate uses for other payment products, but it can be difficult—if not impossible—to get the money back if you've been defrauded after using them," notes Mahoney.

To avoid telemarketing calls, sign up for the FTC's Do Not Call Registry. Note that it may take a while for your phone numbers to show up on the registry. Certain callers—including charities, political entities, and businesses with which you already have a relationship—are still allowed to call you. 

Consider blocking telemarketers' numbers to prevent more calls. Some phones let you block certain numbers; you can also call your phone company to ask if they will block the number, ideally at no cost. Or use a robocall blocker, which can help protect you from unsolicited robocallers, including telemarketers who flout the Do Not Call Registry. And consider joining Consumers Union's EndRobocalls campaign, which is aimed at requiring phone companies to offer free robocall-blocking services.